Bill Text: MI HB5251 | 2021-2022 | 101st Legislature | Introduced
Bill Title: Labor: fair employment practices; severance pay for certain employees who are laid off; require employers to pay for relocations and mass layoffs. Creates new act.
Spectrum: Partisan Bill (Democrat 2-0)
Status: (Introduced - Dead) 2021-07-14 - Bill Electronically Reproduced 07/01/2021 [HB5251 Detail]
Download: Michigan-2021-HB5251-Introduced.html
HOUSE BILL NO. 5251
the people of the state of michigan enact:
Sec. 1. This act shall be known and may be cited as the "relocation, closing, and mass layoff severance pay act".
(a) "Closing" or "closes" means the permanent shutdown of a covered establishment. A closing may occur because of a relocation or a termination or consolidation of the covered employer's operations.
(b) "Covered employer" means an employer that directly or indirectly owns and operates a covered establishment. A parent corporation is considered an indirect owner and operator of any covered establishment that is directly owned and operated by its corporate subsidiary.
(c) "Covered establishment" means a facility or part of a facility at which in the 12-month period immediately preceding a closing, mass layoff, or relocation, 100 or more employees worked, regardless of whether the employees worked at the facility at the same time.
(d) "Department" means the department of labor and economic opportunity.
(e) "Director" means the director of the department, or his or her designee.
(f) "Eligible employee" means an employee who meets all of the following conditions:
(i) At the time of the closing or mass layoff, has been continuously employed at the covered establishment for at least 1 year, including any period when the employee was on a leave of absence. The requirement that the employee be employed at the time of the closing or mass layoff does not apply to an employee who voluntarily quit employment at the covered establishment to take a new job 30 days or less before the date set by the covered employer for a closing or mass layoff in an initial notice provided by the covered employer that is required under this act or federal law.
(ii) Has not been discharged for cause.
(iii) Has not accepted employment at another or relocated facility operated by the covered employer.
(g) "Employer" means a person that employs 100 or more employees.
(h) "Gross earnings" includes all pay for regular hours, shift differentials, premiums, overtime, floating holidays, holidays, funeral leave, jury duty pay, sick pay, and vacation pay earned within the 12-month period immediately preceding the closing or mass layoff. Gross earnings does not include payments made under a third-party benefit program, such as disability payments.
(i) "Mass layoff" means a reduction in a covered employer's workforce, not the result of a closing, that, for at least 6 months, results in a loss of at least 50 employees at a covered establishment.
(j) "Physical calamity" means a calamity such as fire, flood, or other natural disaster.
(k) "Relocation" means the removal of all or substantially all operations in a covered establishment to a new location, within or outside this state, 100 or more miles distant from its original location.
(l) "Week's pay" means an amount equal to an employee's gross earnings during the 12-month period immediately preceding the month of the closing or mass layoff, as determined by the department, divided by the number of weeks in which the employee received gross earnings during that 12-month period.
Sec. 5. (1) Subject to subsection (2), a covered employer that closes or engages in a mass layoff at a covered establishment shall pay to an eligible employee of the covered establishment severance pay at the rate of 1 week's pay for each year that the employee was employed at the covered establishment and partial pay for any partial year. The severance pay to an eligible employee under this section is in addition to any final wage payment to the employee and must be paid within 1 regular pay period after the employee's last full day of work.
(2) Subsection (1) does not apply if the closing of or a mass layoff at a covered establishment is necessitated by a physical calamity or the final order of a federal, state, or local government agency.
(3) A covered employer is not exempt from liability for severance pay under this act solely because it files a voluntary petition for bankruptcy protection under chapter 7 or chapter 11 of title 11 of the federal bankruptcy code, 11 USC 701 to 784 and 11 USC 1101 to 1174, or because an involuntary petition is commenced against it pursuant to section 303 of the federal bankruptcy code, 11 USC 303.
(4) A covered employer that violates this section may be ordered to pay a civil fine of not more than $1,000.00 for each separate violation. A violation of this section may be prosecuted by the prosecutor of the county in which the violation occurred or by the attorney general. A civil fine must not be imposed under this subsection if doing so would prevent the violator from making all payments required under subsection (1).
Sec. 7. A covered employer that violates this act is liable to an affected employee in the amount of the severance pay required to be paid to the employee under this act that remains unpaid. One or more employees may bring an action, for and on behalf of that employee or those employees and any other employees similarly situated, in any court of competent jurisdiction to recover the unpaid severance pay. A labor organization may bring an action on behalf of its members. A court, in an action brought under this section, in addition to any judgment awarded to the plaintiff, shall allow for a reasonable attorney fee and costs of the action to be recovered by the plaintiff.
Sec. 9. The department or attorney general may bring an action in any court of competent jurisdiction to recover unpaid severance pay under this act. The right of an employee to commence an action and of an employee to become a party plaintiff to any pending action brought under section 7 terminates upon the filing of a complaint by the department or attorney general in an action under this section, unless the action is dismissed without prejudice by the department or attorney general. Money from an award recovered by the department or attorney general on behalf of an employee under this section must be held in a special deposit account and must be paid, on order of the director or attorney general, to the employee. Money from an award in the special deposit account remaining 3 or more years after the final disposition of the action, if the money has remained in the special deposit account because of the inability to pay the employee, must be deposited into the general fund.
Sec. 11. (1) A covered employer shall notify the department in writing not less than 90 days before relocating or closing a covered establishment. A covered employer shall notify the department as far in advance as practicable, but no later than within 7 days before a mass layoff at a covered establishment, and shall report to the department in writing the expected duration of the mass layoff and whether it is of indefinite or definite duration. The department shall periodically, but no less frequently than every 30 days, require the covered employer to report facts that the department considers relevant to determine whether the mass layoff constitutes a closing or whether there is a substantial reason to believe the affected employees will be recalled. A notification or report provided to the department under this section must include all relevant information in the possession of the covered employer regarding a potential recall, if applicable.
(2) To monitor compliance with the requirements of this act, a covered employer shall allow the department access to its employees' wage records, with appropriate notice and at a mutually agreeable time.
(3) The department shall create a poster for use by employers that includes statements that summarize an employee's rights under this act. An employer shall display the poster at each of its worksites in a conspicuous location that is accessible to its employees. An employer that violates this subsection may be ordered to pay a civil fine of not more than $5,000.00 for each separate violation. A violation of this subsection may be prosecuted by the prosecutor of the county in which the violation occurred or by the attorney general.
Sec. 13. (1) An employer shall notify the employees of a covered establishment and the officers of the municipality where the covered establishment is located in writing not less than 90 days before closing the covered establishment, unless this notice requirement is waived by the department. An employer that violates this section is responsible for a state civil infraction and may be ordered to pay a civil fine of not more than $1,000.00 unless either of the following applies:
(a) The closing is necessitated by a physical calamity or the final order of a federal, state, or local government agency.
(b) The failure to give notice is due to unforeseen circumstances.
(2) A civil fine imposed under this section must not be collected if collecting the civil fine would prevent the violator from making all payments required under section 5(1).
Sec. 15. Benefits paid or payable to an eligible employee under the Michigan employment security act, 1936 (Ex Sess) PA 1, MCL 421.1 to 421.75, do not reduce the amount of severance pay the eligible employee is entitled to receive under this act.
Sec. 17. The department may promulgate rules to implement this act pursuant to the administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to 24.328.
Sec. 19. This act applies to an employment agreement or collective bargaining agreement that is executed, extended, or renewed on or after the effective date of this act.
Enacting section 1. This act takes effect 90 days after the date it is enacted into law.
